Making an offer on REO property or a foreclosure in Eureka?


	Investing in a bank-owned property is not something to be taken lightly.

What is an REO?

"REO" means Real Estate Owned. These are properties which have been through foreclosure that the bank or mortgage company presently holds. This differs from real estate up for foreclosure auction. Tri-County Realty has experience to share with foreclosures and bank owned properties in Eureka, Missouri

Tri-County Realty has experience to share with foreclosures and bank owned properties in Eureka, Missouri

When buying a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees amassed during the foreclosure process. You must also be ready to pay with cash in hand. Finally, you'll receive the property completely as is. That possibly will involve prevailing liens and even current tenants that may require removal.

A bank-owned property, by contrast, is a much cleaner and attractive option. The REO property did not find a buyer during foreclosure auction. The lender now owns it. The lender will take care of the elimination of tax liens, evict occupants if needed and generally organize for the issuance of a title insurance policy to the buyer at closing.

Take notice that REOs may be exempt from typical disclosure requirements. For example, in Nevada, it is optional for foreclosures to have a Property Disclosure Statement, a document that usually requires sellers to tell you about any defects they are aware of. By hiring Tri-County Realty, you can rest assured knowing all parties are fulfilling Missouri state disclosure requirements.

Am I guaranteed a low price when investing in an REO property in Eureka?

It is frequently thought that any REO must be a good buy and a chance for easy money. This simply isn't true. You have to be prudent about buying a repossession if your intent is to make money off of it. Even though the bank is typically eager to offload it promptly, they are also looking to minimize any losses.

Tri-County Realty has experience to share with foreclosures and bank owned properties in Eureka, Missouri

When contemplating the value of a foreclosure, you need to look closely at comparable sales in the neighborhood and be sure to take into account the time and cost of any repairs or remodeling needed to prepare the house for resale. The bargains with money making potential exist, and many people do very well buying and selling foreclosures. However there are also many REOs that are not good buys and may lose money.

Time to make an offer?

Most lenders have staff dedicated to REO that you'll work with while buying REO property from them. To get their properties advertised on the local MLS, the lender will frequently use a listing agent.

Before making your offer, you'll want to contact either the listing agent or REO department at the bank and find out as much as you can about what they know regarding the condition of the property and what their process is for getting offers. Since banks usually sell REO properties "as is", you'll want to be sure and include an inspection contingency in your offer that gives you time to check for unknown damage and terminate the offer if you find it. As with making any offer on real estate, providing documentation of your ability to secure financing may make your offer more attractive, such as a pre-approval letter from a lender.

After you've made your offer, you can expect the bank to respond with a counter offer. Then it will be up to you to decide whether to accept their counter, or submit another counter offer. Your deal could be final in one day, but that's usually not the case. Since offers and counter offers usually allow a day or more for the other party to respond (and employees at a bank don't work nights or weekends) you could be looking at a week or longer.